World Bank report highlights poverty in Africa

Despite reports for the last several years that there have been significant declines in poverty in sub-Saharan Africa, a recently released World Bank study indicates that, despite “growth,” the actual number of people living in poverty has increased by 100 million over the last 15 years.

In an attempt to reinforce the view of poverty decline, figures are presented that the proportion of people living in severe economic deprivation has declined. But with rising populations, those who are in distress are in fact numerically increasing.

The World Bank presented its report on “End Poverty Day” in Ghana, the first country south of the Sahara to gain national independence from Britain in 1957. Ghana is now often championed by Western financial publications as a “success story” in the broader effort to ameliorate poverty and underdevelopment in Africa.

A World Bank press release states: “The report finds that progress in ending poverty in all its forms has varied greatly across countries and population groups, with the levels of achievement remaining challengingly low. Africa posted the slowest rate of poverty reduction of all major developing regions, with the share of people living in extreme poverty (less than US$1.90 a day) declining only slightly, from 56% in 1990 to 43% in 2012. But since 2012, extreme poverty fell to a projected 35 percent in 2015 in the region, based on the World Bank’s new poverty line of $1.90 a day. Globally, according to Bank estimates released earlier this month, the percentage of people living in extreme poverty will likely fall to under 10 percent for the first time, to 9.6 percent this year.” (Oct. 16)

These figures are plagued by conjecture due to the lack of credible measurement tools and, moreover, whether reliable data was collected on these subjects. In rural areas the number of people living without adequate supplies of water, fuel, food and communications technology often goes overlooked.

The report itself acknowledges this fact: “Gauging Africa’s human well-being remains tremendously difficult. The report shows that in 2012, just 25 of the region’s 48 countries had conducted at least two household surveys over the past decade to track poverty. The authors urge action across Africa in improving the availability and access to regular and reliable data on income poverty and other dimensions of well-being. They also stress that national support for adhering to methodological and operational standards is essential.”

How is growth, development measured in Africa?

The World Bank report reveals the contradictions between foreign direct investment growth and actual income levels, quality of life improvements and socioeconomic development. Setting an extreme poverty level at below $1.90 for individuals and households is problematic.

Many of the advances made in Africa involve the availability of mobile phones and other consumer goods. These goods have enhanced the standard of living in many states by facilitating communications and therefore economic, political and social interactions. Nonetheless, these products come at a price, whether they are manufactured outside the country, as is the case more often than not, or domestically.

Consequently the cost of living is increasing, creating hardship despite the rising household income generated through increased production and trade. Recent strikes in Ghana by private, public and educational workers have largely centered on the decline in the value of the cedi (national currency), requiring larger amounts of money to cover expenses.

In Nigeria, proclaimed in 2014 by the Western-based financial publications as having the largest economy in Africa, many strikes involve workers who are more skilled and have higher incomes. Work stoppages in the medical, educational and oil sectors demand not only higher wages and better employment conditions, but also that employees actually receive their salaries on a regular basis.

In various state departments in Nigeria, public sector workers have gone months without salaries. This has also been a major issue in Ghana among junior physicians and educators.

The distribution of national wealth is the most important factor in determining actual development. Africa has produced billionaires in Nigeria, South Africa and other states. However, the existence of abject poverty remains. Class structures inherited from colonialism have not been eliminated. Those who are in a position to benefit from the continuing integration of Africa into the world capitalist and imperialist system stand to advance their social positions in society.

In Nigeria and South Africa, the largest and most advanced states on the continent, both labor unions and community organizations have demanded that the mining and other extractive multinational corporations reinvest in the environmental and social well-being of the areas where they derive their wealth. Although the workers may earn more than people living in and confined to the rural areas, if resources are not reinvested into creating schools, improving education, cleaning up chemical and industrial waste, and constructing roads and health care facilities, it is not possible to define such a set of circumstances as genuine development.

Wealth must be equitably distributed to foster development

The issues of wealth distribution and production relations must be addressed before there is real qualitative development in Africa and other geopolitical regions. Of course, the World Bank cannot address these issues due to the inherent class bias of its approach to economic growth.

Both the World Bank and the International Monetary Fund were founded by the U.S. capitalist class at the conclusion of World War II to facilitate its dominant position in the imperialist world. In the earlier phase of this development, tremendous resources were poured into Western Europe to rebuild industry and infrastructure destroyed from 1939 to 1945.

However, after the emergence of independent African states during the 1950s and 1960s, IMF-World Bank officials arrived, ready to restructure the postcolonial political economy, emphasizing a neoliberal approach to development by shrinking the size of the public sectors and lowering the value of currencies. Rather than establish import-substitution industries, a path to growth was engineered to emphasize Western foreign investment.

With fluctuations of energy and commodity prices, such a set of international relations leaves the postcolonial states dependent upon the strength of the economies in the former colonial and still imperialist countries. This vulnerability of the oppressed nations, largely located in Africa, the Asia-Pacific and Latin America, stifles and even obliterates the capacity to engage in long-term planning for the benefit of the broad populations in these states.

The constraints placed on making major advancements in agricultural, industrial, educational and social service industries and sectors requires alternative approaches. Socialist economic planning could channel earnings from worker productivity and trade into those aspects of the economy that would produce the most desirable outcomes.

Internal conflict is cited in the World Bank report as a major factor in preventing economic growth. However, the World Bank cannot acknowledge the imperialist destabilization of Africa through military operations and covert activity, since it would directly challenge the foreign policy imperatives of the ruling classes in North America and Western Europe.